Elliott Wave Analysis of the S&P-500 (SPX) by Sid from ElliottWavePredictions.com

Elliott Wave Analysis of the S&P-500 (SPX) by Sid from ElliottWavePredictions.com2012-08-202018-06-22https://elliottwaveplus.com/wp-content/uploads/2016/07/EWP_fullcolor_logo.pngElliottwaveplus.comhttps://elliottwaveplus.com/wp-content/uploads/2016/07/EWP_fullcolor_logo.png200px200px

Elliott Wave Analysis of the S&P-500 (SPX) by Sid from ElliottWavePredictions.com. Click on the chart twice to enlarge.

Here is one of my alternate long-term Elliott Wave counts for the SPX that appears to be gaining in probabilty. As many of you know, I think the 90% U.S. stock market crash from 1929-1932 was a wave 2 at Supercyle degree. It only lasted 3 years. I’ve been thinking that Supercycle wave 3 ended in 2000, and that the 9-year expanded flat that followed (2000-2009) was a completed Supercycle wave 4. Alternatively, the above count projects that Supercycle wave 4 is still underway, and that the 2000-2009 expanded flat was just wave A of a larger sideways structure. I’ll have to admit that this count flows much easier than trying to force a 5-wave impulse onto the March 6 2009 though July 7 2011 period, as my main count does.

The count depicted above expects that primary (burgundy) wave W (ending Feb 18 2011) was a zigzag, and that primary (burgundy) wave X is in the process of carving out an expanded or running flat. Within that burgundy wave X, wave A black (ending September 22 2011) was an expanded flat, and wave B (black) of the flat is nearing completion as a relatively rare WXYXZ combination. If wave B black is 1.382 times the length wave A black was, the target for the top of this bull market would be 1432, which would be followed by a 5-wave impulse to the downside for wave C black and the end of burgundy X. Until wave B black has ended, an exact fibonacci target zone for the end of wave C black cannot be set. As an example though, if the SPX tops at 1432, the best target for the end of wave C black would be 1050, a 50% retracement of the March 2009 thru August/September 2012 structure. This 50% retracement target would have the S&P continuing to follow the 1968-1982 fractal, with the upcoming wave C black representing the 1976-1978 bear.

If this count is correct, wave B black will have lasted 1.618 times as long as wave A black did on September 5.

One slight problem with this count: If the movement since Sept 22 2011 is a WXYXZ, and that is the best way to count it in my opinion, it is a “mixed” combination, with wave W an expanded flat, Y a zigzag, and now Z another zigzag. This does not comply with the statement on page 54 of Frost & Prechter: “…there never appears to be more than one zigzag in a {mixed} combination”. Despite this, because the structure does not count well as anything else, I think the WXYXZ labeling must be considered acceptable until proven otherwise, which may require a slight revision to “the book”.

A solution to that slight problem would be to start the W-wave of the WXYXZ at the actual October 4 low, which would allow the October 4 though October 27 movement to be labeled a zigzag, thereby eventually producing a legitimate WXYXZ triple zigzag, but that would require that the downward movement ending at the October 4 low be a legitimate 5-wave impulse or diagonal within pink wave 5, and there doesn’t appear to me to be a way to count it that way from any of the Aug 31, Sept 20, or Sept 27 highs without breaking at least one rule.

My name is Sid Norris and welcome to Elliott Wave Plus! I’ve been an active investor, trader, and student of the markets for over 30 years. Elliott Wave Plus is the culmination of everything I've learned about technical analysis of the financial markets.